Nifty rises 11% in Jan series; broader mkts outperform

It was an excellent performance by the market in the January series, shooting up 11%. Buying of equity shares worth more than Rs 7,500 crore from foreign institutional investors led the strongest rally in January as they have taken exposure into shares that beaten up badly in 2011, when the market crashed more than 24%. Capital goods, banks, metals and power stocks led the markets higher while technology underperformed with 2% loss.

The broader markets outperformed benchmarks quite smartly, gaining 15% in the January series.

S Naren, CIO Equity, ICICI Prudential still believes that valuations on the small and midcaps are pretty attractive. According to him, even largecaps are still very cheap on historical basis, although they have done very well in last 25 days.

Today, the Sensex rose 81.41 points, to close at 17,077.18 and the Nifty went up 30.95 points to 5,158.30.

Siddharth Bhamre of Angel Broking still feels that the market has not reached to overbought levels. The Nifty rallied from the 4650 to 5150 level in a month.

"There is an almost 30% open interest in Nifty from expiry to expiry, which clearly suggest that apart from FIIs who formed long positions, lot of domestic participants are still short. Addition of open interest and more than 65-66% of rollover clearly indicates that lot of shorts are also getting rolled over. So, I am not bearish on the market," he reasoned.